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The change from group to individual health insurance is a change that many people face today. There can be some important differences between the two types of insurance and cost. Becoming familiar with some of the basic differences will help you know what to expect.
Group health insurance
Group health insurance is purchased by your employer for a health insurance company. All eligible individuals may receive coverage under the plan. Group health insurance is less expensive that the individual health insurance, because you have the buying power of the group. The insurance company bases the premium on an estimate of how much the insurance group as a whole to use. However, if you buy individual health insurance, the calculation of the premium is not based on a group that is based on your own. Therefore, health insurance individual can be so expensive.
Individual health insurance
Individual health insurance is health insurance that you buy from a company insurance on their own, and not through an employer. You can choose coverage for either you or your car and your family, individual policies often offer less coverage Group policies do. Under an individual plan, some services such as substance abuse treatment may not be covered.
Another important difference between the group and individual health insurance is that with group insurance, the law requires the insurance company to cover all those working for that company. With health insurance individual companies are not required to issue a policy. This can be very alarming to people with pre-existing disease. If you have recently lost your job, may be surprising to find that even though it has been covered under a group plan, there is no guarantee that you will be able to get coverage for individual health insurance.
In some states, health insurance companies are allowed to issue policies to people with pre-existing conditions, but are issued with an exclusion rider. That means that the services of pre-existing condition not covered. Each state has its own laws as the monitoring of individual health insurance is administered. Therefore, plans can very greatly from state to state. Plans may also vary from one insurer to another. Be sure to look around and compare quotes and plans for several different companies before making a decision.
COBRA as an option
One of the first options presented to people who have lost their health insurance coverage is COBRA. COBRA is the Consolidated Omnibus Budget Reconciliation and let you go on your employer health insurance plan for up to 18 months after losing his job. However, there are several situations in which employees will not be eligible for COBRA coverage, such as if the company had fewer than 20 people and stopped working, or you fell off your group health insurance or went bankrupt.
One of the COBRA disadvantages is the expense. Under COBRA you must pay the total amount of coverage of health insurance. Whereas, when employed, your employer pays a portion its benefits. A recent development that will benefit the beneficiaries of COBRA is that after 1 March 2009 the beneficiaries will only have to pay 35% the cost of the monthly premium and the federal government will pay the rest for up to nine months.
If you have just lost your group health insurance, switching to individual health insurance will make the cost of health insurance to increase. Understand the different types of insurance and how they work, will help you prepare. If you have pre-existing conditions and coverage are concerned about finding individual health insurance, COBRA investigate and ascertain whether it is an option. Also, check with several companies different health insurance and compare costs before making a decision.
About the Author:
Kevin Kielty lives in North Carolina and writes articles on health insurance. If you are looking for rate quotes on health insurance in North Carolina, visit BCBSNC, also known as Blue Cross and Blue Shield of North Carolina.
Article Source: ArticlesBase.com – Advantages And Disadvantages Of Individual And Group Health Insurance
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